When starting or growing a business in Sacramento, one of the first questions many entrepreneurs ask is:
“What’s the minimum insurance I need to legally operate?”
It’s a smart question—and the answer depends on several key factors including your business type, size, and where you operate. At Eugene C. Yates Insurance Agency, we’re here to make sense of those requirements and help you stay covered, compliant, and confident.
Why Commercial Insurance Matters
Commercial insurance isn’t just a legal checkbox—it’s your business’s safety net. The right policy protects you from financial losses related to:
- Property damage
- Lawsuits
- Employee injuries
- Auto accidents
- And much more
Whether you’re a one-person shop or managing a growing team, the right insurance can make or break your long-term success.
Minimum Commercial Insurance Requirements in California
Here’s a breakdown of the most common types of commercial insurance and the minimums typically required:
✔ General Liability Insurance
- Required by landlords, clients, or contracts.
- While there’s no state-mandated minimum, most contracts require at least $1 million per occurrence / $2 million aggregate.
- Covers bodily injury, property damage, legal fees, and more.
✔ Workers’ Compensation Insurance
- Mandatory in California if you have even one employee.
- Covers medical expenses, lost wages, and rehabilitation for injured employees.
✔ Commercial Auto Insurance
- If your business owns or uses vehicles, you must meet the California minimum liability limits:
- $15,000 per person for injury
- $30,000 per accident for injury
- $5,000 for property damage
- Many commercial policies offer higher limits due to the increased risks of business use.
✔ Professional Liability (Errors & Omissions)
- Often required for licensed professionals (real estate agents, consultants, etc.).
- Covers legal costs if a client claims negligence or inadequate work.
- Recommended minimums often start at $500,000 to $1 million.
Bonus: Industry-Specific or Contractual Coverage
Some industries and client contracts require more tailored coverage, such as:
- Cyber Liability Insurance for tech companies
- Liquor Liability for bars or restaurants
- Umbrella Insurance for added liability protection
How Much Coverage Do You Really Need?
There’s no one-size-fits-all answer. The right insurance depends on:
- Your business type
- Number of employees
- Your location (like Sacramento)
- Whether you lease a space or own vehicles
- Your exposure to liability risks
Let Us Help You Find the Right Fit
At Eugene C. Yates Insurance Agency, we’ve helped Sacramento businesses get quality coverage for over 75 years. Our licensed agents work with the top carriers in the nation to secure custom policies that meet state minimums—and go beyond when needed.
✅ Affordable premiums
✅ Top-rated insurance providers
✅ Fast, free quotes tailored to your business
Need help meeting California’s insurance requirements?
Call us today or request a free business insurance quote. Let’s protect what you’ve built—starting with the basics.